Will the COVID-19 Pandemic Change the IP Domain for the Better?

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Several companies and universities have signed the ‘open COVID pledge‘ to encourage development of treatments and cures for COVID-19. The pledge assures researchers of access to the technology needed to mass-produce masks, ventilators and testing kits. The development of COVID-19 diagnostic kits only a few weeks after the outbreak began is an example of this global cooperation. We have also seen international cooperation in sharing medicines. Governments have also actively stepped into the patent system with discussions of compulsory licensing and creating public patent pools.

All these are unusual activities within the intellectual property (IP) domain. Do they reflect changing dynamics? Will they become the norm, i.e. will IP systems become more IP? And will patent pools become a more common feature of IP rights?

The nature of collaborations is certainly changing from a rigid, negotiated system to a more flexible, open system. We already have smaller manufacturers and larger firms – like the American Inovio Pharmaceuticals Inc. and the German Richter-Helm Biologics – working together, as well as larger firms with each other, as in the case of Sanofi SA and GlaxoSmithKline Plc, to accelerate COVID-19-related manufacturing. Private entities and universities have also come together. For example, the Pune-based Serum Institute of India and the University of Oxford are co-developing a vaccine dubbed ChAdOx1 nCoV-19.

This last example is also one of public-private partnerships. The clinical trials at the university are being funded by the UK government, and the seven manufacturing partners in this project are private entities in Britain, Europe, India and China. Irrespective of the outcomes of the trials, researchers have predicted that the vaccine could hit the markets within six months, a noticeable difference from the usual requirement of a year, if not more.

Political leaders around the world have also been developing plans to improve access to COVID-19-related IP rights. The EU is for example contemplating buying COVID-19-related rights to establish a publicly-owned patent pool or fund. This is a significant development in the IP domain because it’s an unprecedented effort by governments to ensure patents don’t obstruct the fight against the pandemic. Several countries are also exploring a compulsory licensing mechanism, whereby the governments authorise a third-party to make or use a particular process without the permission of the patent’s owner.

Given the pandemic’s severity, several rights-holders have already pledged to not exclude others from using their inventions. For example, AbbVie has announced that it will not enforce its patents on lopinavir, an antiviral drug of interest against COVID-19. Gilead has also sought to rescind the seven-year orphan drug exclusivity period for remdesivir, another antiviral of interest. Closer home, the Serum Institute of India has announced it won’t file patent rights for the coronavirus-related research and manufacturing.

What does this mean for IP in the near future?

These deviations from ‘business as usual’ in the IP realm may seem to be trampling on the rights of inventors and investors – but they are not. The initial response to the pandemic does open the doors for new IP structures but the legal and financial rights of inventors and investors can still be protected. Here are a few ways to achieve this.

* Government facilitated voluntary licensing, with negotiated price with the government – In this option, the government negotiates with the patent owner for lower prices instead of evoking compulsory licenses. Negotiating for voluntary licenses at reasonable rates does not impede the rights of the patent owner. The technology can be transferred on fair, reasonable and non-discriminatory1 terms. This will harmonise technology and royalty flow as well as better channel public goods.

* Active exploration of IP and non-IP incentives – Examples of pharmaceutical market dynamics of vaccines highlights the need for this option. Most biopharmaceutical corporations undermine the vaccine business considering its unprofitability. If a vaccine is efficacious for longer, the demand is lower. (Case in point: the initial reluctance of most firms to get involved in developing a COVID-19 vaccine). These kinds of difficulties can be resolved by pairing IP and non-IP incentives.

One non-IP incentive a government can offer is a transferable/roaming intellectual property right. Here, a company is awarded an additional IP on a product of its choice in exchange for developing a given product pertaining to a neglected disease. Another is a fast-track accelerated approval, whereby a company receives more rapid regulatory review for a product of its choice in exchange for developing a product pertaining to a neglected disease. This effectively lengthens the period of patent protection for the chosen product. Yet another is an advance purchase commitment, wherein a government offers a guaranteed purchase for the IP.

* Public-private partnerships – Public-private partnerships can beat challenges like funding, capacity-building and legal compliance. During the COVID-19 crisis, most research has involved a range of players through such partnerships, allowing them to harness the skills of different organisations at different stages of the R&D process. Governments can support initiatives through research funding for innovations that address development. Joint-ownership of innovations ensures a higher likelihood of mitigating some global ills.

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The bigger question is if the pandemic is an exception or the norm for future IP systems. The debate on this matter is still on; in the meantime, national governments and international agencies like WHO and the UN have commenced policy discussions on safeguarding global common goods. These discussions include legislative measures to reduce IP-based access barriers to goods like food security, environmental protection and poverty alleviation technologies.